An Unusual Setback for the New Jersey Nets

by Kevin Jon Heller

I rarely get to blog about the relationship between my two favorite things — professional basketball and international law — so I would be remiss if I failed to comment on the latest problem to afflict the New Jersey Nets, one of the worst teams in the NBA.  The Nets are in the process of being sold to Mikhail Prokhorov, a Russian billionaire.  As part of that process, the NBA conducted a “very extensive and stringent vetting process” regarding Prokhorov’s finances and concluded that “there was nothing that was disclosed that would cause [it] not to move forward with his application for Nets ownership.”

Oops:

A New Jersey congressman says he will demand a government inquiry into Mikhail Prokhorov, the Russian billionaire poised to buy the New Jersey Nets, for his extensive business dealings in Zimbabwe — a bombshell that could blow up the $200 million team deal and threaten the future of Brooklyn’s Atlantic Yards, The Post has learned.

[snip]

“This is disgusting,” Pascrell said. “Obviously, the Board of Governors of the NBA didn’t do their job properly when they vetted this deal.”

He said the project received tax-exempt bonds.

“It’s being financed partly by the taxpayer, and the public has a right to know,” he said.

Prokhorov’s Renaissance Capital investment bank has interests in the Zimbabwean stock exchange, banks, a cellphone company, mining and a swanky, private big-game reserve. The company is intertwined with Onexim, the $25 billion Prokhorov-controlled investment fund behind the deal to bring the struggling NBA team to Brooklyn.

Pascrell said he will ask the Treasury Department, which oversees the sanctions, to investigate Onexim. In 2008, Onexim became a 50 percent owner of Renaissance Capital, which has been actively investing in Zimbabwe since 2007.

According to its Web site, Renaissance Capital has offices in Manhattan and was the financial sponsor of an economic forum in the Zimbabwean capital of Harare that provided foreign investors special access to government ministers in June 2009 — which experts say is a violation of the sanctions.

I feel sorry for the Nets, but I won’t be sorry if the deal falls through because of Prokhorov’s ties to Mugabe’s regime.  Zimbabwe has never produced an NBA player, but many current players come from Africa — Cameroon, the Democratic Republic of the Congo, the Republic of the Congo, Gabon, Mali, Morocco, Nigeria (11!), Senegal, South Africa, Sudan, and Tanzania — and the NBA actively engages in outreach to the continent.  It would be an insult to everything the NBA stands for if one of its teams was owned by a man who is propping up one of the world’s worst dictators.

http://opiniojuris.org/2010/04/12/an-unusual-setback-for-the-new-jersey-nets/

5 Responses

  1. Hey, at least it’s better than a dog murdering scandal or an “accidental” shooting case.  But perhaps we need more ridiculous laws to help regulate some of America’s pass times: http://lawblog.legalmatch.com/2010/04/09/one-last-post-about-bullying-or-let-the-asinine-legislation-begin/

    That’ll be a great waste of congress’s time…

  2. The Nets are “one of the worst teams in the NBA”?

    Who, pray tell, comes close to the awfulness of the Nets? The Knicks looked like they might contend with the Nets, but even they manage to win a few games. Is there any team in a major sports league that comes close?

  3. Skeptic,

    Minnesota has only won three more games — and I think the Nets are vastly more talented team with a much brighter future.  They have played quite well the past few weeks.

  4. The New Jersey Congressman must be a Knicks fan.

  5. Mr Heller:

    I will defer to your vastly greater knowledge. Basketball ranks at the top of topics in which I have no interest.

    Nevertheless, it seems a rather weak argument to say that a team with 25% more wins is as bad. And I should hope that they have a brighter future.

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